The Forum For People's Collective Efforts (FPCE) has raised concerns and put forth recommendations regarding concessions to real estate developers and the revival of stalled housing projects. In a letter addressed to Union Housing and Urban Affairs Minister Hardeep Singh Puri, FPCE President Abhay Upadhyay expressed worries about certain suggestions made by the committee, which proposed changes in insolvency laws and a scheme offering subsidized interest rates to revive stalled housing units. FPCE emphasized the need for safeguards to prevent misuse of concessions, individualized project extensions, blacklisting of builders with prolonged delays, and a RERA Monitoring Committee to ensure regulatory compliance.
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The Forum For People's Collective Efforts (FPCE), representing homebuyers, has put forth recommendations regarding concessions to real estate developers and the revival of stalled housing projects. In a letter addressed to Union Housing and Urban Affairs Minister Hardeep Singh Puri, FPCE President Abhay Upadhyay expressed concerns about some of the suggestions made by the Amitabh Kant-led committee, which was tasked with examining issues related to legacy stalled projects.
The expert panel, led by former NITI Aayog CEO Amitabh Kant, presented its report to Minister Puri on August 21, proposing changes in insolvency laws and the formulation of a scheme offering subsidized interest rates as measures to revive over four lakh housing units in stalled projects across the country.
In the letter, Upadhyay urged the ministry to circulate an addendum along with the panel's report to various states and government departments. This addendum should clarify that the concessions and exemptions recommended in the report would be limited to legacy stalled projects. Such projects must be identified and categorized as such to prevent any potential misuse.
Furthermore, FPCE emphasized that any extensions granted to projects should be determined on a case-by-case basis, considering the normal timeline required for completion. There should not be a blanket extension of three years, as proposed by the committee. Additionally, builders whose projects are stalled or delayed for more than two years should be blacklisted and prohibited from launching new projects in the future.
The association raised significant concerns about the committee's recommendation for a three-year blanket extension for projects. This extension does not take into account the individual timelines needed for project completion, which may often be less than three years. It also lacks provisions for compensating suffering homebuyers who have endured prolonged delays. Upadhyay stressed that such an extension could financially and mentally burden homebuyers.
FPCE questioned the fairness and sensitivity of the revival package proposed by the committee, highlighting its potential adverse impact on homebuyers. While acknowledging some positive recommendations in the report, Upadhyay also pointed out serious issues that require intervention.
According to FPCE, the committee's findings indicate that some projects are still not registered under the Real Estate (Development and Regulation) Act (RERA), raising concerns about the effectiveness and commitment of RERA authorities in enforcing regulations.
One of FPCE's recommendations focuses on project selection criteria, stating that projects started before 2018 and delayed by more than two years can participate in the resolution process led by state governments and RERA. However, Upadhyay criticized this recommendation for including projects initiated after the enactment of RERA in 2016, suggesting that even post-RERA projects are experiencing delays and issues.
To address these concerns, FPCE proposed the establishment of a 'RERA Monitoring Committee (RMC)' composed primarily of homebuyers, independent individuals, and non-profit organizations. This committee should exclude builders and their organizations and would scrutinize deviations, operational practices, and the overall functionality of RERA authorities, ensuring alignment with the true spirit of RERA implementation.
In conclusion, FPCE's recommendations highlight the need for a more nuanced approach to reviving stalled housing projects, focusing on fairness and protection for homebuyers while holding builders accountable for delays and non-compliance with regulations.
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